Tag Archives: postmodernism

Getting to grips with postmodernism

I am currently working towards starting a doctorate in September and have previously sketched out some ideas for this. I am fairly convinced that postmodernism, whatever this means, has important lessons for banking and finance. It has been encouraging to discover some academics, notably Elton McGoun and the late Norman MacIntosh, who have done fascinating work in this field. But my first task has been to get my head around postmodernism itself, and this can be a daunting task. Countless books, articles and blogs have been written on the subject, and there is nothing like consensus on what the term represents. In fact, the issue is summed up nicely by Stronach & Maclure (1997), discussing the terms “post-structuralism, deconstruction and postmodernism”:

“…if these terms did have something in common, it would be that each problematizes the very notion of definition. Each blocks the escape route to a place outside language, or into metalanguage, from which its essential characteristics could be named…”

So these terms cannot be defined, but I do need to explain them, if only to myself. And I do have one advantage here, which is a background in theology and a strong interest in radical theology, which owes much to postmodernism and which I blog about elsewhere. So based on all of this, and my reading so far, here are two ways I would try to briefly explain postmodernism.

Ever since Plato, Western philosophy has been influenced by the idea that words and concepts correspond to some sort of ideal form “out there”. If we say a word, let’s say “table”, then there is a concept of tableness beyond language to which the word refers. Someone might use the word differently – for example say table to refer to a chair – but that is simply incorrect and misrepresenting the table. In theological language, when we talk about God, evil, law or heaven, we are referring to concepts that objectively exist “out there”. We will never be able to fully represent them, but they are there.

But in postmodernism there is no “out there”, or at least none that is relevant for us, and words do not refer to independently existing concepts. Jacques Derrida famously coined the term “différance” which has overtones both of differing and deferring. So the word “table” does not refer to an externally existing concept – it has meaning simply because it differs from all the other words we use and that meaning is “deferred” into other words, because we can only explain what a table is by using other words. In finance, for example, the word “value” is sometimes used as if it appeals to a non-contextual, absolute concept which we could potentially understand. However, “value”, like everything else, depends entirely on context and language.

Or here is another approach, which takes as its starting point a recent Radio 4 programme about memory called Past Imperfect. We generally assume that our memories can be relied upon, but there is a mountain of evidence to show that memories are often unreliable and it is actually not that difficult to plant false memories in people. Why is this? One expert interviewee, Professor Chris French of Goldsmith’s College, notes that the human brain is subjected to a torrent of information every second – far more than we are able to process or store. So we need to make sense of all this information by being selective about what we perceive and what we remember, so memory becomes somewhat plastic. As far as I can see, one of the ways we do this is by constructing stories, which is the way the human brain can most readily remember things. This happens in all kinds of ways – not just novels and tv dramas but the news, politics, science, songs and many other phenomena involve taking the messy, complicated, chaotic reality and turning it into stories that we can understand and absorb. I am not being critical of stories – I love stories more than most – but we need to be aware of this process.

This, perhaps is one reason why another great postmodern philosopher, Jean-François Lyotard (1984), wrote:

“Simplifying to the extreme, I define postmodern as incredulity toward metanarratives…”

We need to tell ourselves and each other stories – that is part of being human – but at the same time we need to treat them with a bit of suspicion. All stories are incomplete and told from a particular perspective, there is always another way to tell a story and that might be illuminating. To take just one example of a novel that illustrates this superbly – An Instance of the Fingerpost by Iain Pears, set in seventeenth-century England, tells the same story from four different perspectives. It makes for a gripping read, but should also provoke us to think about the nature of storytelling and how we perceive reality. All four accounts are contradictory and none can be fully relied upon. The title is a quotation from Francis Bacon that refers to the process of deciding what is really the situation but the book itself subtlely subverts the very idea of getting at “the truth”. So can we ever rely on human perception to tell us “what really happened”? Finance uses plenty of stories too, often in numerical form which gives them a spurious sense of accuracy, but we should always be aware that a story is a partial incomplete account, and will differ if told from another perspective.
So I am starting to explain postmodernism to myself with these narratives but of course there are plenty of others. However, they do illustrate, to me at least, why the postmodern perspective is still needed so badly in finance and elsewhere.
Lyotard, J-F (1984) Postmodern Condition: A Report on Knowledge, trans Bennington, G., Massumi, B. Manchester University Press, Manchester.
Stronach, I. & MacLure, M. (1997) Educational Research Undone: The Postmodern Embrace. Open University Press, Buckingham. 

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New beginnings, the fragility of finance and postmodernism

As 2015 draws to a close, I am more than usually excited about the coming  year. This is because, after nine years with BPP, I am moving on to a new and very different job. It is never easy to move when you have spent that long with an employer, and anyone who has read previous blog posts will know that they have been absorbing years where I have learned a lot, and developed a strong interest in technology and its implications for education. I am proud of many things achieved at BPP, and there are many colleagues whom I will miss greatly.
However, an opportunity has arisen that seems almost too good to be true. We moved to Shrewsbury four and a half years ago because we fell in love with the town. At that time, my job was to write material for accounting courses, and do some teaching and project work. I could mostly work from home and teach in Birmingham. Then an innovative project brought me into BPP Business School and the world of higher education, continued homeworking and more travel. Also, although I did not know it at the time, plans were being drawn up for Shrewsbury to get its own university, initially a campus of Chester University. Skipping a few stages to get to the present, last summer I was offered a job as Senior Lecturer in Accounting & Finance at the University Centre Shrewsbury. The first undergraduates started in September and I will start work there in mid-January.
This is a different venture at many levels, and one of the exciting aspects of working at a brand new and growing institution is that things are sure to change quite fast. It is also a condition of my appointment that I gain a doctorate, so I will be enrolling on this next September (about 25 years after I first contemplated a doctorate, as it happens – these things come around eventually). After so many years in finance, management and education I have many ideas about what to study. I am also a firm believer in open scholarship, so in that spirit I will share my current thoughts on the research here with anyone who is interested.
At BPP I led the development of a programme called the MSc Financial Leadership, which is for qualified accountants and explicitly based on the idea of social constructionism. This is the perspective that much of our world does not have objective existence but is created by societies through language, law and custom. For example, a company does not physically “exist” and can only act through its agents. Other “legal fictions” include marriage, government and, importantly for accountants, money. Money only has value because the law says it does and we all believe it. The MSc programme is aimed at raising awareness in accountants that virtually everything they deal with in their work does not have objective “existence” – it is socially created, therefore historically conditioned and subject to change.
Where this idea gets really interesting is in the industry where, one way or another, I spent much of my practitioner career – banking. Because banking takes social constructs and legal fictions to a whole new level. We often like to think of our bank balance a bit like the scene in Harry Potter novels where he goes to Gringotts Bank and can see the vault with his treasure in it. Somewhere, we feel, there is a little pile of money on the bank’s vaults with our name on it. This is nonsense, of course. All we have is an entry in the bank’s ledger to say that they owe us money, and a belief that, if we need the money, they will pay it to us. But if any more than a small fraction of depositors want their money back at any one time, then the game is up, the bank will fold and our balances will be exposed as fictional. This is a lesson we all saw played out with Northern Rock in 2007.
When explaining this to students, I like to say it is literally a confidence trick. It all works fine as long as we believe in it. But if we stop believing, it is finished. The whole financial system is held together by pure belief. That is why the Northern Rock crisis was resolved by the government underwriting them. We all believe the government, at least for the time being.
If this doesn’t scare you, at least a little bit, you aren’t paying attention.
There is something very postmodern about this situation, as John Lanchester and others have pointed out. Our bank balances are symbols which refer only to other symbols, and are ultimately guaranteed by another symbol, but one that is potent enough that we all trust it. This situation is not discussed very much because it is too scary and all those with a vested interest in the situation (which is in fact most of us) do not want there to be too much questioning and doubt. Even most of those who work in banking are unaware of its insubstantial structure and accept assurances about how “sound” and “solid” the institutions are.
We could leave it there, but I suspect that at some point we will realise how insubstantial the financial system is and it will collapse, causing a lot of pain in the process. Is there another way forward? I have come across a couple of prescriptions, including a shift to electronic currencies and replacing banking with a range of specialist services, and these probably have their part to play, but as an educator my instinct is to look at the way finance professionals and bankers are trained and developed. Do they realise how insubstantial the system is and its implications? I think not – accountants are trained in a body of knowledge that is dated and treated with excessive reverence. Bankers are generally trained less than accountants and any training they do get tends to have a narrow, technical focus. Navigating and changing a fragile, postmodern system requires a breed of professionals who can take critical thinking and reflection to a new level. So what would their education look like?
At present, this is where I would like to take my doctorate. In the spirit of open scholarship, I would love anyone who is interested to add their comments or contact me direct and let me know what you think.

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